Internet company AOL Inc. is buying news hub Huffington Post in a $315 million deal. AOL, once the king of dial-up Internet access, is in the midst of a turnaround effort as it tries to find ways to boost online ad sales to offset declines in the access business.
The acquisition announced early this morning (Mon., Feb. 7) is among the most aggressive strategic moves engineered by AOL CEO Tim Armstrong in an effort to reshape a fallen Internet icon.
After the acquisition closes later this year, Huffington will run AOL’s growing array of content, which includes popular technology sites Engadget and TechCrunch, local news sites Patch.com and online mapping service Mapquest.
At the same time, Armstrong has laid off hundreds of employees to try to boost AOL’s financial performance and stock price. It has been a slog so far. AOL lost more than $780 million last year, largely because of accounting charges, and the company’s stock is now worth slightly less than after it was spun off from Time Warner Inc. 14 months ago.
The deal “will create a next-generation American media company with global reach that combines content, community, and social experiences for consumers,” Armstrong said in a statement announcing the deal.
Founded in 2005, Huffington Post is owned by Arianna Huffington, Kenneth Lerer and a group of other investors. The site attracts 25 million monthly visitors. AOL will pay $300 million of the purchase price in cash.
Information from The Associated Press contributed to this report.